The private health industry's time is up

Obama has been supportive of a public option, but how do you solve the healthcare problem when you fail to deal with its root?

ByBernie SandersJune 16, 2009

Washington — President Obama has indicated he wants a healthcare bill on his desk sometime around October, before we worry about timetables, however, we as a nation have to answer two very fundamental questions.

First, should all Americans be entitled to healthcare in the same way we respond to other basic needs such as education, police, and fire protection? Second, if we are to provide quality healthcare to all, how do we accomplish that in the most cost-effective way?

The answer to the first question is pretty clear, and one of the reasons that Barack Obama was elected president. Most Americans believe that all of us should have healthcare coverage, and that nobody should be left out of the system. The real debate is how we accomplish that goal in an affordable and sustainable way.

To me, the evidence is overwhelming that we must end the private insurance company domination of healthcare in our country and move toward a publicly funded, single-payer, Medicare-for-all approach.

Our current private health insurance system is the most costly, wasteful, complicated, and bureaucratic in the world. But in America, the people who have to navigate that maze are the lucky ones. Today, 46 million people have no health insurance and even more are underinsured with high deductibles and co-payments. At a time when 60 million people, including many with insurance, do not have access to a medical home base, more than 18,000 Americans die every year from preventable illnesses. That is six times the number who died in the 9/11 terrorist attacks.

Despite the fact that we spend almost twice as much per person on healthcare as any other country, our healthcare outcomes lag behind many other nations. According to the World Health Organization, the United States ranks 37th in terms of health system performance and we are far behind many other countries in terms of such important indices as infant mortality, life expectancy, and preventable deaths.

The main reason we get such bad results is that the function of private health insurance companies is not to provide quality healthcare for all, but to make huge profits for those who own the companies. With thousands of different health benefit programs designed to maximize profits, private health insurance companies spend an incredible 30 percent of each healthcare dollar on administration and billing, exorbitant CEO compensation packages, advertising, lobbying, and campaign contributions. Public programs like Medicare, Medicaid, and the department of Veterans Affairs are administered for far less.

In recent years, while we have experienced an acute shortage of primary healthcare doctors as well as nurses and dentists, we are paying for a huge increase in healthcare bureaucrats and bill collectors. Over the past three decades, the number of administrative personnel has grown by 25 times the number of physicians.

While healthcare costs are soaring, it should surprise no one that profits of private health insurance companies are more than keeping pace.

From 2003 to 2007, the combined profits of the nation's major health insurance companies increased by 170 percent. And, while more and more Americans are losing their jobs and health insurance, the top executives in the industry are receiving lavish compensation packages.

It's not just William McGuire, the former head of United Health, who several years ago accumulated stock options worth an estimated $1.6 billion, or Cigna CEO Edward Hanway who made more than $120 million in the past five years. The reality is that CEO compensation for the top health insurance companies now averages $14.2 million.

The president has been supportive of a public option – a plan that people could opt into if they are uninsured or don't like their private coverage. But the situation is extremely fluid. How do you get to the root of a problem when you fail to take on the private health industry?

The time is now for our nation to address the most profound moral and economic issue we face. The time is now for our country to join the rest of the industrialized world and provide cost-effective, comprehensive, quality healthcare to every man, woman, and child in our country. The time is now to take on the powerful special interests in the insurance and pharmaceutical industries and pass a single-payer national healthcare program.